EU likely to require more concessions from Google

The European Commission is likely to require more concessions from Google in an ongoing antitrust probe, the European Union's Competition Commissioner Joaquin Almunia said.

The Commission is now analyzing proposals that Google submitted in April to alleviate its concerns, Almunia said Tuesday during a session of the Committee on Economic and Monetary Affairs.

Google rivals had complained to the Commission that they were unfairly penalized by Google's search algorithm, which places their services lower in search results while Google promotes its own. Google's proposals to resolve these concerns were submitted to all the complainants and stakeholders last month.

This so-called market test should have been concluded on Monday, but at the request of some participants Almunia said he decided to extend the review period by one month.

Google's proposals were heavily criticized earlier this month by Foundem, a British vertical search engine that was one of the first to complain to the Commission about Google's search practices.

According to Foundem, Google's proposed remedies would not change anything and make things considerably worse. If the remedies are adopted, Google would likely move specialized services to paid placement, Foundem said.

"As a result, pretty soon the only vertical search services not handing over most of their profits to Google would be Google's own vertical search services," Foundem said in their paper at the time, calling this construction "an anti-competitive double-whammy."

Almunia seems to have taken such criticism on board. "After we have analyzed the responses we have received, we will ask Google -- probably; I cannot anticipate this formally, but almost 100 percent -- we will ask Google 'you should improve your proposals,'" Almunia said.

If this happens, Google can send new proposals to resolve the concerns, and a decision can be made, Almunia said, adding that he hoped to reach a positive outcome in this way.

But if the negotiations do not have a positive conclusion, the Commission needs to adopt a statement of objections and go to the end of the procedure under Article 7 of the antitrust regulation, he added. In such a case, the Commission can prohibit Google's practices and impose sanctions such as a fine of up to 10 percent of an undertaking's total turnover in the preceding business year.

Google continues to work with the Commission to settle this case, a Google spokesman said in an emailed statement "We believe our proposal to the European Commission addresses the four the concerns that were raised."

Loek is Amsterdam Correspondent and covers online privacy, intellectual property, open-source and online payment issues for the IDG News Service. Follow him on Twitter at @loekessers or email tips and comments to loek_essers@idg.com

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